With Geologists having estimated that 1 in 200 Kimberlite pipes will have diamonds, Botswana Diamonds Plc (BOD) continues to forge ahead with its exploration project in Botswana. This is confirmed by their announcement that the company has raised ┬ú500,000 (approximately $722,967.80) to fund ongoing diamond exploration at its joint project with Alrosa.
Kimberlite pipes are regarded as the most important source of diamonds mined today. In 2013, BOD entered into a 50/50 joint venture with Alrosa, the Russian diamond producer, to explore diamonds in Botswana. Under the partnership, Alrosa provides its technology and expertise while BOD secures the exploration projects through the licenses it acquires. The results of the exploration projects became evident in 2015 as announced by BOD. BOD acquired several licence areas with a specific focus on high priority targets under exploration. The current funds follow the cash that was raised earlier last year in March amounting ┬ú282,500 which had also been raised to fund the exploration projects as well as the company’s working capital requirements.
The decision to source additional funds was taken in December 2015 whereby BOD issued a total of 64,154,850 New Ordinary Shares with Warrants attached to raise ┬ú545,316. The company later announced in March 2016 that the total budget is $700 000 (approximately $485, 011.60 as at 9 May 2016) of which half of it was expected to be paid by BOD.
BOD Chairman John Teeling was quoted in September 2015 as saying, “Diamond exploration is very high risk but there is potential for a new kimberlite. Orapa is a world-renowned area for diamond-bearing kimberlites. The second part of the programme involves more intensive soil sampling on PL 206 as well as on the new Orapa licence PL 085. Good Kimberlitic Indicator Minerals (KIMs) have been found on PL 206. The new work is to narrow down the area to define a target. Additionally, we have three small licences in the Gope region. Analysis done by Botswana Diamonds geologists indicate anomalies on each licence. The Alrosa team will carry out verification sampling. If the results are confirmed, drilling will follow.”
As a follow up to this, BOD confirmed the commencement of the drilling project in April 2016 targeting the potential source of the strong Kimberlitic Indicator Minerals (KIMs).
On the cash that BOD recently raised, Teeling is quoted as saying, “We have a very active ongoing drilling, sampling and geophysics programme on our ground in Botswana. We expect this work to continue through the rest of 2016. This placing ensures we are fully funded.”
Given the nature of exploration as a risky activity without guaranteed results it remains to be seen if the current available cash will be sufficient to carry the exploration through to the commencement of mining.